Everyone to the 2025 RBC Global Healthcare Conference. My name is Greg Renza, one of the biotech analysts here at RBC, and we're pleased to be joined by ADC Therapeutics just now. Joining us from the company, in addition to the full team, of course, we have representing ADC, Ameet Mallik, Chief Executive Officer. Ameet, great to see you. Look forward to a discussion. A great deal going on in the space, a great deal going on with ZYNLONTA, certainly with EHA coming up, with recently reporting earnings and seeing the trajectory of ZYNLONTA in the market today. Maybe the way we can get started is for those less acquainted with ADC Therapeutics, just have you give a brief intro to the company.
Sure. Thank you, Greg. I appreciate the opportunity. ADC Therapeutics is an antibody-drug conjugate company. We have end-to-end capabilities from research through commercialization. Our strategy is really focused on two different pillars. The first is on ZYNLONTA, which is our commercialized product, where we have multiple different studies to expand the use into earlier lines of DLBCL, as well as into indolent lymphomas. Our second pillar, which is an early-stage solid tumor pipeline, the most advanced of which is exatecan-based programs, in particular those targeting PSMA and CLDN6, are the most advanced.
Fantastic. Maybe a good way to do this is just to have you maybe share some of the updates about how ZYNLONTA is doing in the market with the recent disclosures just last week, and maybe setting some context for the performance in late-line DLBCL. Then we'll go on to the data and the updates that are coming.
Sure. Yeah, maybe just to give a little context, when you move into that relapsed/refractory setting within DLBCL, the market really kind of segments into two broad categories. The first is more complex therapies that require specialized infrastructure, expertise, and patient management. These are cellular therapies and bispecific-based therapies, which have very high efficacy, but not every physician is able to administer them. Then you have broadly accessible therapies like ADCs and chemotherapy, which can really be administered by any sort of physician, including in the community setting, and really diversely almost any patient. Those are the two segments of our strategy. Right now, we're approved via the accelerated approval pathway as a monotherapy in the third-line plus setting. Just to give you context between those two segments, the cellular therapies and bispecifics have about 60% of that third-line plus setting.
The more broadly accessible therapies have about 40%. We have about 10% market share, so meaning 25% of that 40% is what we're doing. I feel very pleased about our performance because we've been able to maintain that despite bispecifics, which were only launched about two years ago, have taken over about a third of the market. That segment, which was about 25% of complex therapies, has grown to 60%. Yet we maintain a roughly 10% share. We've been able to gain ground in new centers and with new patient groups. I feel good about that, but even more excited about what's coming next in DLBCL with our further studies.
Absolutely. Maybe just following up here, when it comes to the community versus the academic setting and just the potential untapped market there, the impact of CAR-Ts and bispecifics that you've alluded to, how is that evolving? I know even an ODAC yesterday, which I'd love to get your views on, several moving parts. Just walk us through the sort of ADC perspective.
Sure. So as I mentioned, if you look at the dynamics, I mean, frontline hasn't changed very much over the last several decades. Really, R-CHOP has been the mainstay. The one, of course, change that's happened over the last couple of years is that Pola-R-CHP got approved. About a third of the patients frontline get that therapy. That's been the one advancement. Frontline's a very high bar, obviously, because more than 60% of patients get cured in that frontline setting with the existing standard of care. The bar is extremely high. Once you move into second-line, CAR-Ts make up about 20% of the therapies. Right now, bispecific combinations are in the guidelines, but none have yet been approved. Really the majority of that market is the broadly accessible therapies like ADCs and monoclonal antibodies and chemotherapies.
Once you move to the third-line setting and plus, you have CAR-T, transplant, and bispecifics taking about 60% of the market, and then broadly accessible therapies like us and chemotherapy taking up the remaining 40% of the market. What I'm excited about is that we really can play in both segments extremely well. We have a strategy with our confirmatory phase 3 study, which is combining ZYNLONTA plus rituximab. Our base therapies are the most commonly used amongst those broadly accessible therapies. We've already completed enrollment in this study. We expect to hit the prespecified PFS events by the end of this year and then have top-line results either end of this year or early next year, depending on when we get the events.
In that segment, we've already shown in the first 20 patients in our safety run-in, we've shown efficacy data, which is an 80% overall response rate, a 50% CR rate, and with manageable safety profile. We're going to be presenting data so the abstract's already out at EHA, where the median duration of response for the CRs wasn't reached even two years later. That's similar to what we saw with the monotherapy. It is very durable when you get into CR. We've seen with ZYNLONTA. On the other hand, for the more complex therapies, we believe we have the opportunity to have the best-in-class bispecific combination therapy. We have a collaboration with Roche studying ZYNLONTA plus glofitamab, where we've seen unprecedented efficacy.
Recently, there was an abstract that we published that was shared that's going to be presented at both EHA and ICML, showing an overall response rate of over 95% and a CR rate of 91% across the first 22 evaluable patients. This is the dose expansion of ZYNLONTA. We've now completed 40 patients in that dose expansion, and we plan to share a larger data set with much longer follow-up at EHA and then also at ICML. Of course, in that analysis, there'll be a lot more data than what's seen in the abstract. To note, I would say also in our studies, especially because you asked about ODAC, and there was obviously a lot around the Asian versus non-Asian population, just to address that head-on.
We don't go into specifics, obviously, for ongoing randomized phase 3 studies because getting into patient characteristics and baseline characteristics without efficacy doesn't really make sense. I mean, we present all that together. What I can say with our LOTIS-5 study, though, is we have significantly less Asian enrollment in our study and a much larger study. So we have a 420-patient randomized study, one-to-one randomization. There are a lot of differences in the profile, I think, of the study design as well as in the population. LOTIS-7, which is the data I mentioned that has a 91% complete response rate, is entirely enrolled in the U.S. and Europe, the majority of which is in the U.S. Excellent, excellent.
As far as taking the LOTIS-7 data, just talk about the potential anticipation of the next steps, the FDA engagement just after this data and the next steps there.
Yeah, I mean, we're really excited about the data because when you look at all the bispecific combination studies that have read out anywhere from phase one studies through phase three, the CR rates, which we know is a very good predictability of durability, have all been in the range of 47%-62%. That's the range. CAR-Ts, of course, are a bit above that. You see them ranging in kind of the mid-60s to the low 70s in terms of CR rate. For us, if we were even in the mid-60s, it'd be highly differentiated. We thought if we could get above 70% CR rate, you clearly become the best-in-class efficacy agent amongst the bispecific combinations. To see 91% in our first 22 patients is obviously outstanding data. The way we plan to move forward is twofold.
One is we're assessing options now to expand at our selected dose to 100 patients. We know that about 100 patients is what's allowed three different bispecific combinations to get preferred in NCCN guidelines. We think we could have that enrolled pending the funding by early next year, or certainly in the first half of next year, and then be able to share that data with a year of follow-up and potentially get into guidelines as soon as 2027. When you look at the regulatory side, now that we have the dose expansion, all 40 patients completed, we're waiting for the scans of that. We plan to engage with the FDA in the second half of the year on the dose selection, as well as potential phase three designs.
Gotcha. Okay. All right. Very good. And then as you quote some base assumptions about the commercial opportunity, $200 million-$300 million in the LOTIS-5 area, a lot of nice layers. Maybe just help us break down the understanding of how that works, how it translates to the value for the company.
Sure. You start with, in the third-line setting, you have about 6,000 patients. When you move to second-line, you go to 12,000 patients. You double the population by moving to the second-line setting. In addition, we know that our duration of therapy right now in third-line plus as a monotherapy is about three cycles. When you get to second-line, we're seeing on average five to six cycles. You're going to see double the population with much longer durability and, of course, a better clinical profile because what we've seen as a monotherapy is CR rates of roughly 25%. What we've seen in the safety run-in for LOTIS-5 is 50%, and we've seen over 90% with LOTIS-7. Clearly, much better clinical profile in a larger patient population with a longer duration of therapy.
Even if you were just to take the LOTIS-5, for example, our roughly 10% share that we've seen in the third-line setting, even if we were just to maintain that share, you'd get well over $200 million. Obviously, with some improvement in share, given you have a much better clinical profile, we get to $200-$300 million opportunity versus our roughly $70 million in sales that we have in the third-line setting. With LOTIS-7, because we do think that bispecific combinations have the potential to be the largest segment in that second-line plus setting, we believe we have a chance to play a leadership role that could bring the total opportunity for ZYNLONTA, inclusive of LOTIS-5 and our current indication, to $500-$800 million. Beyond that, we also have additional opportunities in indolent lymphomas, which could add even further to the potential of ZYNLONTA.
We think there's a lot of opportunity for growth. Really, over the next several months, we're going to have a lot of data de-risking events, which allow for us to start, we think, a much more significant growth trajectory starting in early 2027.
With the other indications in the expansion, maybe just recap a little bit the ASH data and follicular and marginal zone, just the take-home message there, what should we expect to see next and how much of a priority is that as far as the expansion equation?
Yeah, so we have two different phase two IATs. One is looking at the relapsed/refractory high-risk follicular lymphoma patient population. In the first 39 evaluable patients at ASH, the investigator presented a 77% complete response rate. It's a very robust complete response rate, especially in the population where these weren't only high-risk patients, but more than half of which were POD24. It's a pretty tough-to-treat patient population. We know that follicular is much more competitive. There's a lot of phase three studies, but we think we may have an opportunity. We've already gone into NCCN guidelines with actually that patient data in the non-preferred status, but we think with the 100-patient study, we have the opportunity potentially to get in preferred, especially for the patients that can benefit the most, which are these high-risk patients. We'll also consider different regulatory strategies for FL as well.
For marginal zone lymphoma, that's a much, it's a much rarer population. There's only 3,000-4,000 relapsed/refractory MZL patients in the U.S.. And there haven't been any randomized purely MZL studies ever conducted. When you look at the, there's been two approvals and two additional regimens in the guidelines. Mostly the BTK inhibitors dominate this space. They've all been based on anywhere from 36-68 patients, and there hasn't been a CR rate more than 29%. The ASH data, which is in the first 23 patients of a 50-patient study, showed a CR rate of 70% and with a manageable safety profile. The profile looks really interesting. Based on the study, we plan to engage with the FDA and other regulatory authorities on a potential approval based on the study, but also will, of course, submit to NCCN guidelines.
Just to give you a sense of how big the MZL opportunity is, the total theoretical market opportunity, if you add 3,000-4,000 patients times the five to six cycles of ZYNLONTA that you get times our net price, that's a total market opportunity of $500 million in peak sales. For every 10% share that we're able to achieve, if we're successful, that would translate into roughly $50 million per year additionally, just for every 10% share. We think marginal zone is an additionally good opportunity in particular. Follicular will be a little bit tougher because of the competitive landscape, but we think there's potentially an opportunity, at least in those high-risk patient populations.
Great, great. Yes, 2025 is certainly a year for new ZYNLONTA data points, but we never want to overlook the pipeline, Ameet. Maybe we can talk a little bit about the pipeline evolution in solid tumors, the next-gen ADCs that you're contemplating taking forward, and how that fits into the broader scheme of your strategy.
Yeah, so I mean, we've really been focused, the most advanced part of our portfolio is really focused on exatecan-based ADCs, focusing on, I think, some pretty big solid tumor targets, the two most advanced of which are PSMA and CLDN6. We're going to be moving one of those through IND this year. We haven't disclosed which one. The strategy has been, from a capital allocation standpoint, we're investing really the majority of our money against ZYNLONTA because we see a near-term opportunity to really get to a significant growth trajectory and even get to market independence at some point for the company. On the solid tumor side, we are investing to a point, but investment, particularly when we get to the clinical stage, will depend on collaborations and partnerships. We're in a number of different discussions around that as we speak.
That's great. You mentioned market independence, so it's appropriate to ask about not just the capital allocation, what you're allocating, your cash position, and how it diffuses to the rest of the organization.
Yeah, so we ended Q1 with $196 million in cash. That gives us a cash runway into the second half of 2026. Now, a couple of things to note that are important. We burn anywhere from $30 million-$35 million on average per quarter net. That's after sale. That's our net kind of cash burn. Close to $10 million of that is LOTIS-5, which we know is finished enrolling. We're still seeing costs because you have a lot of patients in the study. As we get into that second half of 2026, obviously, those costs start to go away. We have another roughly $10 million, which is in our research expense, which is, as I mentioned before, a lot of that future funding will depend on a potential partnership or collaboration.
If we think of what the needs will be, especially as 2027 starts a growth trajectory with multiple different growth opportunities, as I mentioned, with LOTIS-5 and LOTIS-7, potentially even with indolent lymphomas, the pathway towards market independence starts to become clearer over the course of that period of time.
You've mentioned partnerships with future collaborations and future assets. What does an optimal partnership look like? How do you think about the decision tree for an ideal partner to move forward in advancing one of the assets?
I think we're open to the different structures. I think the key thing is we have multiple assets to move forward. As you know, to do things properly takes real money. Some of these require biomarker analysis. They can involve multiple solid tumors, not only as a single agent, but also in combination. We think about PSMA, for example, the potential to combine with ARIs or when it comes to CLDN6, the potential to combine with platinum. To do these studies and to really investigate the total cost takes some real money. That's why we think when you get into solid tumors, partnering, especially when you get to that clinical stage, is a way for us to unlock more value and to have more shots on goal. The way the collaboration can be structured, I think we're open to that.
Great, great. Just in the last moments, I want to see if the audience in New York here has any questions. Okay. Any closing remarks before we break?
Yeah, no, I would just say, first of all, thanks for the opportunity. As I said, within our core focus at ZYNLONTA, we believe we have a tremendous opportunity. We're moving from a small indication in third-line plus where we have monotherapy efficacy of roughly a 25% CR to an environment where we can move into earlier lines of therapy with what we've seen so far in our early safety run-in, 50% CR with LOTIS-5 combined with rituximab or an over 90% CR rate combined with glofitamab in the LOTIS-7 setting. We think these opportunities combined with the potential opportunities with indolent lymphomas can bring this drug to a $600 million-$1 billion peak sales opportunity in the U.S. We have global partners as well where we benefit from milestones and royalties, which is further upside, especially as time goes on.
Because of where our cash runway is, we do not need so much more to get us to that point where we get into the growth stage and then get eventually towards market independence. We are excited about the opportunity. We think we have a lot of exciting data, particularly this year. It will be a big data de-risking year to set us up for what we think could be a really big growth trajectory starting in early 2027.
That's great. Thank you so much. Great to see you and look forward to EHA and all the updates this year.
Yeah, thank you very much, Greg. Appreciate it.
Thanks, everyone.
Thanks.